Hoboken Legal Beagle – 10/28/2008

Notwithstanding the recent 47% property tax increase many residents will be hit with, one Hoboken411 reader wonders about how assessments in Hoboken work in general.

How are assessments triggered?

“So I am a Hoboken renter and am considering buying now that prices have softened some. I’m looking at one place that is about 800 sq/ft with taxes of only $2,300! The 2BR condo’s assessed value is only 115k as of last year, up from 100k in the 3 years prior. I noticed the condo is assessed as only a 1 BR, despite having 2.

If I buy this place do I have to worry about a $5k tax hike next year? How does this work in Hoboken? Will we pay taxes on the purchase price or just some random assessment? Will a purchase trigger a new assessment? I’m hoping one of your readers know this process or has been through this already. Thanks for your help.”

Hoboken411 Legal Beagle says:

Your assessment only changes if work is done on your unit or a city wide reevaluation occurs. Your taxes are not determined by your purchase price, they are determined but the amount of the original assessment plus the value of any work that increases the value of your unit. A purchase does not trigger a new assessment.

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1) The 47% increase only applies to the municipal portion on the tax bill right? Where can I see the break down?

b) Assuming pigs learn to fly and a reval happens, would it be just on the improvement portion of the assessment or both land and improvement?[/quote]

answer to #1) you should get a green and white document yearly that says “THIS IS NOT A BILL” (but looks like one) across it…this is just a copy of what your tax breakdown is that I assume goes to your mortgage company too

[quote comment=”115048″][quote comment=”114966″]If an assessment is done will a formula be applied to make it fair for all? There hasn’t been an assessment in 30 years. The homes were not worth 30 years ago what they are worth now. It doesn’t matter if improvements have been made or not. It’s not fair to assess properties that haven’t been assessed in 30 years at today’s Hoboken home prices. There was no gentrification in town 30 years ago.[/quote]

Huh? If someone paid $1.5mm for a townhome, why should they pay a fraction of what someone in a condo that costs $600K pay? It is absolutely fair to reassess buildings based on their relative market values. That is how just about every city in America does it. You look at what the home is worth and you set that as the assessed value. Given the number of transactions in town, it isn’t as if you can’t find accurate comps to benchmark against.[/quote] Dawnrose, that logic makes absolutely no sense at all nor do I undertand where you are going with this. The whole point is that the homes are not assessed at today’s prices. That’s the problem!